Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist (Summary)
Imagine a doughnut. The hole in the middle is a place where people are falling short on lifeās essentials: food, water, healthcare, and political voice. The outer crust represents the ecological ceilingāthe planetary boundaries we cannot safely cross, like climate change and biodiversity loss. The goal of economics, Raworth argues, isn't endless growth; it's getting all of humanity into the doughnut itselfāthe safe and just space where everyone can thrive.
The Goal Isn't Growth, It's Thriving
The 20th-century obsession with Gross Domestic Product (GDP) as a measure of success is dangerously flawed. It ignores human well-being and environmental destruction. The real goal should be to bring all of humanity into the 'Doughnut's' sweet spot.
A country can cut down all its forests to sell timber, and its GDP will skyrocket. But this metric completely fails to account for the catastrophic loss of the ecosystem's ability to clean air, prevent floods, and support life. GDP measures output, not well-being.
We Aren't 'Rational Economic Man'
For centuries, economics has been built on a false caricature of humanity as a selfish, isolated, calculating individual. In reality, we are social, interdependent, and guided by a complex set of values beyond pure self-interest.
In the 'Ultimatum Game' experiment, one player is given money and must offer a share to a second player. If the second player rejects the offer, neither gets anything. A purely 'rational' player would accept any offer, even a penny. But in reality, people worldwide consistently reject offers they deem unfair, proving that we value fairness and reciprocity over small monetary gains.
Shift From a Degenerative to a Regenerative Economy
Our current industrial model is degenerative by design: we take resources, make products, and dispose of them, polluting the planet at every stage. A 21st-century economy must be regenerative, mimicking nature's cyclical patterns where waste from one process becomes food for another.
The Danish industrial park in Kalundborg is a prime example of 'industrial symbiosis.' A power stationās excess heat warms local homes and a fish farm, its fly ash is used to make cement, and its waste gypsum is sold to a wallboard manufacturer, creating a circular system that eliminates waste and generates new value.
Design Systems to Distribute, Not Just Grow
Instead of waiting for growth to 'trickle down' to the poor (which it often doesn't), we should design economic systems that are distributive from the start. This involves rethinking how wealth, income, and ownership are generated and shared.
The Mondragon Corporation in Spain is a federation of worker cooperatives with over 80,000 employees. As co-owners, the workers share in the profits and participate in decision-making, leading to far lower income inequality between the top executives and the shop floor than in traditional corporations.
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